Overnight, we had two reports showing that the Euro-zone economy - and
especially Germany - posting strong levels of activity in
manufacturing and services.
We had the preliminary readings come out for January in both of those
sectors. The manufacturing PMI for the Euro-zone came in at 56.9, a
bit lower 57.1 reading we had in December, but it still shows modestly
strong growth in activity. The surprise was a jump in the Euro-zone
services PMI to 55.2 from December's 54.2. It was therefore the
services sector that helped push the "Composite Output Index" - a
combination of both manufacturing and services - to a six-month high.
Germany led the gains as its services sector PMI climbed to 60.0 in
January from 59.2 in December.
In a second report we had industrial new orders for the month of
November rise 2.1% from a 1.3% rise in October. Here, Germany led the
way and it shows that new orders picked up in the middle of the 4th
quarter.
What today's data tells us is that if Euro-zone politicians can come
together to put a lid on the sovereign debt crisis, then there may be
some positive fundamental macro-economic data in the Euro-zone that
could help support the Euro currency.
In today's trading, we had the Euro decline a bit, probably a
correction to the strong gains we finished up with to end last week.
There are no US fundamentals today, so let's keep an eye on technical
factors and how equities open this week.
Source: ActionForex.Com
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